Earnings fall `at fastest rate in 60 years`

Average weekly earnings in February were 5.8% lower than they were a year before, according to the Office for National Statistics.

This represents the fastest `collapse` in 60 years, as The Telegraph reports, quoting Michael Saunders, chief UK economist at Citigroup: "We certainly haven`t seen anything like this in the last 60 years - and probably not in peacetime since the 1930s. In that sense it`s much like everything else in the economy."

"Falling wages can easily lead to debt problems," said a debt management expert for Gregory Pennington, "as people tend to look at their current income when they`re calculating what sort of debt repayments they`ll be able to afford on a monthly basis.

"Figures like these really underline the importance of leaving a margin of error - and taking into account the fact that anyone`s financial situation can deteriorate over time.

"Anyone who was already devoting most or all of their disposable income to their unsecured debt repayments will find it particularly hard to cope with any fall in their income (if their hours are reduced, for example). We would recommend that anyone in that situation talk to a debt adviser about ways of staying on top of their debts."

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